from the lessons-from-the-front dept

About a decade ago, I wrote a long analysis of why digital "goods" were really a "service," not a "product," and explained how this was the key to understanding modern business models. I had submitted it to a large publication, who came back and told me that my reasoning made no sense at all and they refused to publish it. It may be true that my reasoning doesn't make much sense, but it's nice to see that others are coming to the same conclusion. Hypebot has a nice post from singer/songwriter Jeff Macdougall explaining how music must be viewed as a service, rather than a product, if those in the music industry want to successfully adapt to the changing market:

When a label executive tells you that they are "not in the business of selling discs", (or vinyl, tape, t-shirts, etc.) and that they are actually "selling music," they are, at best, fooling themselves, or at worst, lying to your face. Moving plastic, vinyl, paper and/or any other tangible good they can dream up is exactly what the recording industry has been about since it was established.

Sure, the labels spend money and time trying to infuse their products (CDs, posters, etc.) with content (music, album art, etc.) to raise its intrinsic value, but it's still the CD or poster that they are/were selling... not the music itself.

He goes on to note that music is really an experience, and people should stop focusing on copyright law or the idea that file sharing is "stealing," and focus on the overall experience and building models based on that.

Of course, he doesn't quite get into the difference between a service and a product -- and it's one area that people sometimes get confused about, so one way to simplify it is to think of it like this: a product is a single thing created in the past that you now own. A service is paying for something to happen in the future. It's not a perfect explanation, but in my experience, this simple distinction often gets people thinking creatively about how to turn a business model into one focused on selling a service, rather than a product.